A new model for business is taking shape and it`s built on the largest communications network on the planet - the Internet.
The concept of e-business harnesses the power of the Internet to create and capitalise on new business opportunities.
It`s no wonder that established organisations and start-up companies alike are eyeing the Internet in order to maximise their business potential and ensure continued growth in an increasingly competitive global marketplace.
And there is little doubt that the e-business economy will soon dominate all sectors of the market. Oracle Corp has predicted that this will occur - on a global scale - sooner rather than later.
What is an e-business?
Among analyst and industry organizations, a consensus is emerging about what constitutes an e-business.
In essence, an e-business is any business that uses the Internet or Internet technologies to achieve the following:
- Attract, retain, and cultivate relationships with customers
- Streamline supply-chain, manufacturing, and procurement systems and automate corporate processes to deliver the right products and services to customers quickly and cost-effectively
- Capture, analyze, and share business intelligence about customers and company operations in order to make better business decisions
From a global perspective, no one industry is moving more quickly than retail to take advantage of all the promise e-business offers.
This is because retailers have already experienced the benefits of electronic data interchange (EDI) and better information management, and they see the concept of e-business as a natural progression in the process of leveraging information for business advantage.
In line with companies in all industries, retailers are increasingly aware of the new and cost-effective e-business methods to streamline business processes, integrate suppliers and partners, attract and retain customers, expand into new markets, defend against new competitors in their markets, and exploit new opportunities.
Low cost, high value channel
In addition, they view the Web as a low-cost, high-value channel for their operations - and know that if they don`t exploit the opportunity, they may lose out to competitors who do.
With creative thinking and robust, cutting-edge internet technologies, global retailers are adopting e-business practices to manage customer relationships distinctively, streamline corporate business processes, and leverage information to make strategic and operational decisions.
Their innovative practices could soon be standard procedure, even for companies in other industries and at earlier stages of e-business evolution.
Successful e-businesses in the retail sector have demonstrated the need for a complete and fundamental change in culture, processes, practices and technology.
Doing business on the Web requires building a customer-responsive enterprise to integrate all of the customer-facing operations.
Equally importantly, the company must work together with suppliers online, facilitating a supplier-managed inventory and trading through global electronic trading communities.
Unique elements
Developing a Web business strategy has some unique elements that require new planning processes. Obviate these, as some failed high profile dot.com companies have done, and the road becomes that much harder.
For example, a systematic methodology should be used to analyze components such as budget, market conditions, competition, timing, level of urgency, and customer preferences.
Thereafter a comprehensive Web business plan should be created, complete with objectives, required actions, and organizational structures.
Internal data, such as operating and strategic planning information, will be needed, as well as decisions about business objectives, pricing strategies, branding, customer relationships, business processes, and value propositions.
Because of the global nature of the audience, it is critical to preplan their experiences on the web site.
The product is the service
On the internet, the product is the service. An old - yet very valid - clich'e notes that the Web is an operating environment in which competitors are just a click away.
To build customer relationships, loyalty, and - most important - sales, companies must differentiate themselves by providing customers with valuable new-age services.
For example, Oracle customers such as Fogdog Sports, an online sporting-goods retailer, has personalized the shopping experience from the moment customer logs on to its site.
Home-furnishings retailer Living.com makes it possible for shoppers to outfit their home from a single online source.
US-based Drug Emporium is able to lead visitors quickly through 20 000 line items to find the products they need either by brand name or generically.
Finally, music-products retailer CDNOW has one of the most-trafficked e-commerce sites in existence, thanks in part to its personalization capabilities.
These and many other e-businesses are moving at warp speed to capture and retain consumer hearts, rands, dollars and pounds as the world population of online shoppers explodes.
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